Every time you send a message, make an online purchase, or stream a show, a data center makes it possible.

Though invisible in our daily lives, these technological facilities support all our digital activity.

From AI-powered applications to cloud platforms enabling e-commerce, the digital economy relies entirely on this technological infrastructure.

However, in Latin America, data centers have a strategic value far beyond technology, becoming a key factor in regional economic development.

Local Investment

For decades, the lack of local facilities forced many companies to rely on servers on other continents, leading to higher costs, significant latency, and security risks.

This dependency also hindered the development of local digital talent, placing the region at a competitive disadvantage compared to more advanced economies.

This situation is changing rapidly. The region has significantly increased investment, mainly private, in digital infrastructure, building local data centers and progressively closing the technological and economic gap.

The key lies in the efficiency and innovation these infrastructures enable, acting as essential catalysts for digital transformation.

Agility and Quality

By migrating their operations to specialized data centers, Latin American companies improve productivity, reduce operating costs, and gain flexible access to advanced technology, paying only for the resources they actually need.

One of the main advantages is increased productivity. Thanks to centralized access to real-time data, key sectors such as agriculture, manufacturing, and transportation are making faster, more effective decisions.

The intensive use of advanced analytics and artificial intelligence allows them to optimize processes, reduce operational times, and offer more agile, higher-quality services, significantly boosting their competitiveness.

You May Also Like

• Three Smartphone Trends to Advance a Digital Future for All
• Artificial Intelligence for Timely Diagnosis of Tropical Diseases

Another major benefit is the reduction of operating costs and scalability. Companies can quickly adjust their use of technological resources based on actual demand, avoiding unnecessary spending on idle infrastructure.

This adaptability also facilitates the agile development of new products and services, enabling companies to respond quickly to changing market needs.

Additionally, operational resilience is a key factor that data centers bring to the digital ecosystem.

Cloud services provide constant backups and effective plans for recovery from critical incidents.

This capability proved especially valuable during the pandemic, when companies that had advanced in digitalization could easily maintain operational continuity through remote work.

Regional Boom

Latin America is currently experiencing a significant boom in data center investment.

This market is estimated to nearly double in size over the coming years, growing from approximately $5 billion in 2023 to almost $10 billion by 2029.

Brazil, Mexico, and Chile are leading this regional expansion, but countries like Colombia, Peru, and Costa Rica are also emerging as attractive tech hubs.

Since last year, around 30 new data centers have been either under construction or recently inaugurated in the region.

Although this is a significant step forward, Latin America still lags behind advanced economies, where most global digital infrastructure remains concentrated.

Strategic Necessity

Investing in data centers is no longer optional but an urgent strategic necessity.

Each new center inaugurated reduces external technological dependency, strengthens the local digital ecosystem, creates highly specialized jobs, and fosters the emergence of innovative startups capable of competing globally.

To maintain and consolidate this momentum, Latin America must aim for operational standards similar to those of global leaders like AWS, Google, or Meta, which manage to use up to 90% of consumed energy directly for useful computing tasks.

In this regard, the region is already progressing by incorporating efficiency technologies such as liquid cooling and modular designs, reducing operating costs.

More From IDB Invest

• Originate to Share: IDB Invest 2024 Annual Report
• Check our New Careers Page 

However, challenges remain. The region needs to accelerate investments, train specialized human capital, establish robust regulatory frameworks that ensure security and privacy, and build trust among companies and users.

At iDB Invest, we support the private sector's transformation with specialized advisory services in digital transformation and financial solutions tailored to the region's needs.

We offer everything from refinancing to advanced project finance structures, with a strategic focus on developing and expanding data centers.

In the global race for competitiveness, data centers are becoming the engine driving the region toward a more prosperous, connected, and competitive future in which digital technology defines the rules of economic development.